The Geopolitics of Autonomous Vehicles – Implications for the United States

Johns Hopkins University By Joshua Henderson

AVs will fundamentally change the energy intensity of automobiles. Currently, vehicles are left parked 95% of the time. AVs will change this dynamic by providing fleets of easily accessible transportation through automated mobility services, similar to a highly efficient Uber or Lyft. This may greatly reduce the incentive for car ownership. While there will be less vehicle ownership, usage will increase. AV fleet services will increase the efficiency of traveling by car instead of using public transportation. Public transportation will be less convenient and will not have significant cost saving advantages. Additionally, ease of travel will incentivize people to live further away from cities where housing is cheaper. Different studies have forecasted the impact of AVs on energy intensity and vehicle usage with varying results. The Department of Energy’s NREL sees a possible 90 percent fuel savings to more than 250 percent increase in energy use.

AVs will require software that connects them to the world; vehicle-to-vehicle communication and vehicle-to-infrastructure communication will be paramount. For example, cars will need to connect to satellites for effective navigation and communicate with other vehicles to know where they are on the road as well as their speed and route. This high level of connectivity is necessary for the benefits of AV technology but it also represents a cyber-security risk. Cars are already highly connected. In 2015, two white hat hackers hacked into Jeeps to show vulnerability to a cyber-attack. The hackers were able to apply the brakes of the vehicles from miles away.

The United States and China are leading the world in investing in new technologies, specifically advanced computing such as artificial intelligence and AVs. These two countries are global economic leaders and rivals. AV technology is not only a commercial opportunity for the countries but also a strategic imperative. As China has grown richer, American firms have wanted access to the Chinese market. However, the price of access is sharing American technology. Meanwhile the Chinese government finances domestic companies expanding into foreign markets. For clear evidence of China’s technology plans look at its latest 10-year plan, called “Made in China 2025,” which aims to make it an innovation hub.

A large increase in VMT (vehicle miles of travel) will require significantly more energy. Changes in population habits, such as decreasing reliance on public transportation as well as longer commutes, will increase the need for more oil and electricity. At the moment, it is still uncertain when electric vehicles (EVs) will overtake internal combustion engine vehicles (ICEVs) in market share but even Bloomberg New Energy Finance, which is bullish on EV growth, estimates EVs will only account for 33 percent of light duty vehicles in the world by 2040. This will mean that for several decades AVs will be operating on a mix of ICEV and EV technologies and US policy will have to protect supplies of oil as well as invest in electricity generation and infrastructure. Given the global nature of oil prices, the US will have to continue to maintain a presence in the Persian Gulf, ensuring continued supply of the world’s oil. However, the introduction of EVs, which rely on lithium batteries, will be a new resource. The US will have to employ the same strategic thinking on oil to lithium supply; the US will have to know the location and size of lithium deposits (mostly in China, South America, and Australia), prices, reliability, usage, and life-span of batteries.

Cyber threats are already a focus for US national security. Terrorist or ransomware attacks are possible and have happened. AVs will compound the vulnerabilities the US faces. Boston Consulting Group has categorized AV vulnerabilities as either direct or indirect. Direct attacks involve hacking or malware used against vehicles themselves, likely causing crashes or disrupting routes. Indirect attacks will involve attacks on the infrastructure necessary for the use of AVs, for example disrupting cellular networks or GPS systems. Most importantly, policy makers will have to consider that the car companies that make the vehicles and the technology companies that program the software are not cyber security companies. Yet, AVs will require all three: hardware, software, and anti-virus/-hacking software.

The US has already had to plan for attacks on the electricity grid, which has 3,300 utilities and 5.5 million miles of distribution lines across the country. In 2015, Ukraine’s power grid was attacked and parts of its system were shutdown, most likely by Russia. In 2003, a programming error, which failed to warn operators of the need to redistribute power, led to a blackout in the Northeast and Midwest, which lasted for two days in some areas. Policy makers and security experts will need to prepare for similar disruptions or attacks on AVs.

While AVs currently represent commercial competition, the United States should be aware of who has access to the technology. Countries or companies with AVs in the US will have unprecedented power over the car fleet. Fleets of AVs in the United States could be controlled by foreign companies or countries. For most foreign countries that have successful car industries like Japan or Germany, this is unlikely to be a problem. However, there is acute risk from geopolitical opponents, specifically China. Both the United States and China are competing to have the best technologies. For now, both countries see cooperation as more important than confrontation but in the future, they may have competing interests. At that point, if the AV fleet in the United States is partially controlled by a Chinese company, it could pose a national security threat. For example, if Chinese cars were 10 percent of the US car fleet, the ability of China to have control over millions of cars could cause disruption by China shutting them down, using them to block streets, or collecting intelligence at sensitive areas.